Growing remittances emerge as Zimbabwe’s FDI alternative – total $830 million in 1st half of 2016, expected to reach $1,5 billion by year end

Zimbabwe registered $830 million in diaspora inflows including NGO funding in the first 6 months of 2016 maintaining an upward trend that has seen official remittances increase from $300 million in 2009 to the $935 million registered in 2015.

In June 2016 a total of $157 million was received via diaspora remittances.

In an interview with the Independent, the deputy governor of the Reserve bank of Zimbabwe (RBZ) Kupukile Mlambo shared some of the figures on remittances to Zimbabwe pointing out how $440 million of the total inflows registered between January and June 2016 were from non-governmental organisations.

With dwindling foreign direct investment (FDI inflows fell by 23% between 2014 and 2015 from US$545 million to US$421 million), remittances are now the second largest form of capital inflows for Zimbabwe behind exports, emerging as Zimbabwe’s leading FDI alternative.

In 2015 the country registered $2,7 billion in export revenues and with a depressed agricultural performance blamed on a drought and constraints felt in the mining sector through effects like commodity price shifts this total is likely to be lower in 2016.

This places remittances as a key component in Zimbabwe’s economic strategy. So far they have been supported by the proliferation of inflow alternatives that include mobile money remittance channels that local mobile money services like EcoCash and Telecash have adopted in partnership with a host of global remittances concerns.